Adient (ADNT) has an "attractive valuation" with the stock trading near cyclical lows at about four times next-12-month enterprise value-to-earnings before interest, taxes, depreciation and amortization, limiting downside risk, UBS Securities said in a report Wednesday.

UBS has upgraded the automotive seating maker to buy from neutral, and raised its price target to $30 from $22, citing improving cash flow prospects, the report said, adding that the investment bank expects Adient to generate as much as $300 million in annual free cash flow in coming years, translating into an estimated free cash flow yield of about 18%.

The upgrade also reflects expectations that Adient could raise its fiscal 2026 guidance, which the UBS said may serve as an "immediate catalyst." Adient previously guided fiscal 2026 EBITDA to $845 million, but the forecast could rise to about $880 million as North American and Asian production outlooks improve, the report said.

As automakers shift production back to the US amid evolving trade policies, Adient is positioned as a potential "winner." The investment bank estimates the company could capture up to 300,000 incremental vehicle units, potentially adding $35 million in annual earnings.

Shares of the company were up more than 7% in recent Wednesday trading.

Price: 23.05, Change: +1.60, Percent Change: +7.46